DLF net debt falls marginally; to raise Rs 6,000 cr by Mar'13

Last Updated: Saturday, February 11, 2012 - 20:57

New Delhi: Realty giant DLF's net debt has declined by Rs 169 crore in the third quarter of this fiscal to Rs 22,758 crore and it expects to raise about Rs 6,000 crore by March 2013 from sale of non-core assets for debt reduction.
In an analyst presentation, DLF said the company "remains focused on target divestments of Rs 6,000-7,000 crore. Proceeds are to be utilised primarily for debt reduction".
According to the presentation, the company is expecting Rs 2,000 crore from sale of hospitality venture Amanresorts and another Rs 1,000 crore from sale of wind energy business.
DLF expects to raise upto Rs 4,000 crore from sale of strategic projects in Mumbai and Chennai and another Rs 1,000 crore from sale of other projects that it did not name.
The company has raised Rs 1,620 crore so far this fiscal as against Rs 1,110 crore in the entire 2010-11.
DLF said it has outsourced all construction intensive activities to third parties in order to improve the pace of construction.
"We will hand over 27-30 million sq ft in the next 2-3 years to third party contractors like L&T and Shapoorji," DLF Executive Director (Finance) Saurabh Chawla told analysts in a conference call on Saturday.
The company has already handed over 9.5 million sq ft to third party contractors this fiscal, he added.
"In the last 6-8 months, there has been some slowness in construction activities due to labour issues. With third party contractors coming in, the execution risk will go away. However, there will be some cost escalation," Chawla said without giving details.
Yesterday, DLF reported 45 percent fall in consolidated net profit at Rs 258 crore in the third quarter of this fiscal on account of lower than expected sales. It had posted PAT of Rs 466 crore in the year-ago period.
The Q3 consolidated revenue also fell by 8 percent to Rs 2,396 crore, from Rs 2,594 crore in the year-ago period.
"With macro environment continuing to remain unfavourable with high interest rates, commodity and labour cost inflation, the company's strategy shall require patience and caution to execute.
"Given these uncertainties, the company expects longer than anticipated time for its initiatives to take fruition," DLF had said.
Despite the company continuing its focus on launching plotted land developments, premium housing, divestment of non-core assets and reduction of debt, DLF may take few more quarters to regain full momentum, it had added.


First Published: Saturday, February 11, 2012 - 20:57

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